At the beginning of 2015, your company buys a $30,000 piece of equipment that it

Question

At the beginning of 2015, your company buys a $30,000 piece of equipment that it expects to use for 4 years. The equipment has an estimated residual value of $2,000. The company expects to produce a total of 200,000 units. Actual production is as follows: 44,000 units in 2015, 53,000 units in 2015, 51,000 units in 2017, and 52,000 units in 2018.

1) Use the straight-line method to prepare a depreciation schedule (that shows the Depreciation Expense, Accumulated Depreciation, and Net Book Value by year)

2) Use the units-of-production method to prepare a depreciation schedule (that shows the Depreciation Expense, Accumulated Depreciation, and Net Book Value by year)

Explanation / Answer

At the beginning of 2015, your company buys a $30,000 piece of equipment that it

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